Gabriella Beale with Rose & Womble says the home on Mayflower Road (behind her) sat on the market for a year before the owner had to drop more than $20,000.00 to sell it. Based on data from academic research and gathered by the Pilot, properties effected by chronic flooding – even just of roadways – are taking a major hit in their values. Gabriella is seen on Tuesday, Oct. 9, 2018.

Gabriella Beale with Rose & Womble says the home on Mayflower Road (behind her) sat on the market for a year before the owner had to drop more than $20,000.00 to sell it. Based on data from academic research and gathered by the Pilot, properties effected by chronic flooding – even just of roadways – are taking a major hit in their values. Gabriella is seen on Tuesday, Oct. 9, 2018.

Waterfront homes used to be the safest investment in real estate, but rising tides have turned a sure thing into a potential liability.

After a review of property value data and a litany of studies, The Virginian-Pilot has found mounting evidence that real estate values across Hampton Roads are being driven down as a result of recurrent flooding and sea level rise.

One couple in Norfolk has had their waterfront house, once valued at more than a million dollars, on the market for two years. They’ve dropped the price to less than $800,000 and are still waiting for a buyer.

And it’s not just s even-figure waterfront homes in Norfolk and Virginia Beach taking the hit. Values of seemingly safe houses several blocks from the water are hurting as well.

Several recent studies have shown that impacts from flooding – from water in the basement to inundated streets – already have hamstrung property prices and cost Hampton Roads homeowners hundreds of millions of dollars in lost or unrealized values.

The region is home to the one ZIP code – 23320 in Northern Chesapeake – that saw the biggest loss in Virginia in potential property value over the past 12 years, according to one study.

If not for flooding, properties in that area could be worth $37.6 million more than they are today.

Elsewhere, Norfolk property owners have lost out on $55.5 million in unrealized value since 2006, while Virginia Beach is in a similar boat at $40.4 million.

Homeowners might be surprised by these staggering numbers – in many places where research shows flooding is hurting home prices, city assessments show those values rising.

They’re just not rising as fast as they could be.

“Part of the idea of getting these numbers out there is that people may not know they’ve lost value, because the actual value may still be going up,” said Jeremy Porter, a Columbia University professor who worked on the recent study with the First Street Foundation, a nonprofit that pushes for solutions to sea level rise by presenting data.

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Norfolk

It’s nearly impossible to determine what’s dragging assessments down based solely on city data. New development, general neighborhood declines and a host of other issues all impact property values.

“I can only measure the market,” Ronald Agnor, the real estate assessor in Virginia Beach, said when asked how flooding is affecting property values. “I can’t go into the depths and read the minds of buyers and sellers.”

And the trend is not uniform. Several neighborhoods in Norfolk, for example, have seen waterfront values that are strong and growing.

In Ballantine Place, home values are weaker along the Lafayette River and its tributaries than those in the neighborhood's interior . Next door in Fairmont Park, though, waterfront properties haven’t been hindered.

However, real estate agents to academics to homeowners agree that recurring flooding and rising seas are driving down the value of what were once considered desirable investments.

A group from First Street and academics from Columbia University developed Flood iQ, a website that allows people to see how the values of waterfront homes have fared since 2006 when compared to similarly valued homes that don’t deal with flooding.

The researchers aimed to control for variables including neighborhood amenities and number of bedrooms. They found that generally, homes near the water and those affected by flooding are appreciating at a much slower rate than an equivalent home a bit further inland.

The Washington Post recently highlighted Flood iQ and two other academic studies that came to the same conclusion: Coastal property values aren’t keeping pace.

The First Street group studied the values of homes from Virginia to Florida dating back to 2006 and found they’re worth $7.4 billion less than they would be otherwise.

Three-quarters of that loss was due not to flooding homes, but flooding streets, said Steven McAlpine of First Street Foundation.

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One Norfolk couple knows all about that.

Roger and Paula Stenlund say it’s common to get stuck in their home on Mowbray Arch – the road that forms a ‘U’ around The Hague – when both ends of the street flood.

Their home was recently valued at $1 million, but they’ve had to lower the price to $795,000 since they’ve put it up for sale.

Roger Stenlund attributes the loss of value to lower sale prices of homes around him – houses he said are on lower ground and pay more in flood insurance.

Flood iQ data indicates a loss of nearly $12,000 since 2006 for their address, which may be owed to those flooded streets.

“I don’t know if this is a blip or not,” he said. “Maybe we’re fooling ourselves.”

About 20 miles to the east, Patricia and Richard Elkins can empathize.

Their now-elevated home is on Bay Island in Virginia Beach. City data shows significant drops in property values in that area from 2012 to 2017. Assessments on one block alone went from $105.3 million to $91.5 million, a 13 percent decrease.

When the Elkinses moved there in the late 1990s, “nobody back then” talked about flooding. “We really were clueless,” Patricia said. “I think we were young and enthusiastic.”

Chesapeake

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Many of those who made their home along the shorelines of Hampton Roads said they were drawn to these properties for the very thing now potentially hurting their home values: water.

“People seem to gravitate towards coastal cities, and people are continuing to gravitate toward this coastal city,” said Norfolk’s chief resilience officer, Christine Morris. “We’re trying to create an environment where the risks are reduced.”

She and other city officials downplayed flooding’s effect on home prices, saying they don’t put too much stock in any one study.

“The conversation about real estate value is always such a complex one,” Morris said. “There’s a lot of variables.”

But researchers say studies paint a clear picture, despite the complexities and uncertainties.

“Saying we can’t understand the role of flooding on the housing market is a little off base,” said Tim Komarek, an economist and researcher from Old Dominion University

If Flood iQ allows people to see big picture flood impacts, a study at ODU takes it down to the micro level.

Virginia Beach

A group of university economists published a study this summer showing that severe storms – which scientists say have become stronger and more frequent in recent years due to climate change – can have a meaningful impact on property value and how long a home spends on the market in Hampton Roads.

Properties in high-risk areas declined in value after major storms and stayed on the market longer – and not just in the initial aftermath.

After Hurricane Irene in 2011, sale prices for homes in at-risk areas continued to be suppressed by 5 percent for five years after the storm compared with homes outside the flood zones, the ODU study found.

Additionally, homes in high-risk flood zones spent longer on the market after a storm – between five and eight days.

“It is a little bit of a surprising result in some ways,” Komarek said. “The contagion of flooding really does spread farther than those impacted, and that’s important to understand both from the homeowners’ perspective and the city’s perspective.”

In Norfolk, the city will collect $700,000 less in real estate taxes this year thanks to the effects of flooding on property values, according to Flood iQ’s data. The study said that shortfall will only grow in the coming years, unless someone does something to stem the rising tide.

“The hope is, now that the value is quantified, it’s an easier economic equation to say ‘solutions are worth implementing,’ ” said Matthew Eby from the First Street Foundation.

This year, the city boosted real estate taxes by 8 percent to bring in $18.4 million more annually, of which $1.8 million was earmarked to combat sea level rise.

Komarek did acknowledge one uncertainty: How much of the drop in values is due to actual flooding, and how much is because potential buyers are scared off by flood insurance premiums and other costs?

Portsmouth

___

The home in Norfolk’s Colonial Place sits overlooking the Lafayette River. A waterfront home if there ever was one – just a few blocks from some of the most expensive real estate in Hampton Roads.

Last January, it was listed for sale at $320,000. But a familiar neighborhood culprit was keeping interested buyers away: flooding.

Insurance rates reflected that: $3,000 a year even after flood mitigation efforts were put in place.

A home that could be viewed as an investment no longer carried its weight with buyers.

“We had to lower the price,” said Gabriella Beale, a realtor with Rose & Womble Realty Company, which has offices around Hampton Roads.

It eventually did sell – after sitting on the market for nearly a year – for $300,000.

As a whole, Beale said, waterfront properties are still popular. But for homes that frequently see flooding, buyers are letting it be known: These properties are no longer seen as the safe bet they once may have been.

“Even if I’m in the middle of Kempsville, people are asking about flooding,” Beale said. “The first-time buyer knows it’s an issue in our area.”

Beale is up-front with her buyers and does her best to tell them about insurance rates and flood zones. Some buyers are comfortable with the listed price but learn about high monthly payouts for flood insurance and simply walk away. Money not spent on flood insurance can be spent on another house.

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Gordon Rago is a general assignment reporter on the Pilot's digital enterprise team. Prior to Virginia, Gordon was a reporter at the York (Pa.) Daily Record for four years. He started his journalism career in north Idaho.

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